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Trading Strategies, Psychology
Scaling in Trading: Techniques to Optimise Returns and Control Risk
Introduction to Scaling in Trading Scaling in trading involves adjusting the size of trading positions based on specific criteria or rules. This concept is crucial for both discretionary and automated traders, with the latter group often finding it easier to implement due to the structured, rule-based nature of automated systems. For discretiona...
November 6, 2024Read More >Addressing the 9 Critical Psychological Challenges When Creating and Trading Expert Advisors (EAs)
It's well-known that many discretionary traders struggle with discipline, emotional control, and other psychological hurdles that can impact their decision-making process, particularly when it comes to entering and exiting trades. One of the widely recognized benefits of automated trading models, however, is the belief that these psychological barr...
October 24, 2024Read More >Strength of Signal – An Important Consideration for Traders?
In this article, we take an in-depth look at the concept of strength of signal and its potential role in improving trading outcomes. Traders are constantly seeking ways to enhance their results consistently, and the idea of evaluating the strength of a trading signal may provide a pathway toward greater reliability and performance when applied to t...
September 13, 2024Read More >Earning Season: Prep starts now
We are less than three weeks away from the ASX earning season and we are less than two weeks away from the earnings season in the US. So, we need to start prepping for trades and opportunities now. First and foremost, do not forget that confession season is well and truly upon us here in Australia. Downgrades clearly have been coming from the ...
July 5, 2024Read More >Rights Issues Explained: A Guide for Shareholders and Investors
A rights issue, also known as a “rights offering”, is a method that companies use to raise additional capital from their existing shareholders. It involves offering the right to purchase additional shares of the company's stock at a discounted price while maintaining their proportional ownership in the company. This is how the rights issue...
September 5, 2023Read More >PE ratios: What they tell you (and what they don’t)
What is a P/E Ratio? The Price-to-Earnings (P/E) ratio is a indicative valuation metric that measures a company's current share price relative to its earnings per share (EPS). It is relatively simple calculation and is simply worked out through dividing the current share price by the Earnings per share. There are two common variations of...
August 25, 2023Read More >Look before you leap …FIVE reasons why a low PE Ratio may be a reason NOT to jump in
What is a PE Ratio, and Why is It of Interest to Investors? The Price-to-Earnings (P/E) ratio is a metric that measures a company's current share price relative to its earnings per share (EPS). It's a relatively simple calculation, worked out by dividing the current share price by the Earnings per Share. Traditionally, it has been used as a p...
August 25, 2023Read More >The Art of the Fundamental Exit: Knowing When to Walk Away
Entries for longer-term stock investment approaches can be based on either long-term technical trends or more commonly, fundamental data related to a company's current and projected performance. Despite the plethora of such suggestions, there is often a lack of clear guidance, or even a complete absence, of instructions on determining the timing of...
August 21, 2023Read More >Money in Motion: The Factors Influencing Currency Appreciation and Depreciation
Currency appreciation refers to the increase in value of one currency relative to another currency or basket of currencies. Depreciation refers to the opposite scenario where a currency loses value against another. When a currency appreciates, it takes more units of other currencies to purchase one unit of the appreciating currency, and of cours...
August 21, 2023Read More >Navigating the Curve: Backwardation and Contango in Futures Markets
Backwardation and contango are terms used in the context of futures markets to describe the relationship between the prices of futures contracts with different expiration dates for a specific underlying asset, such as commodities, currencies, or financial instruments. In this article, we aim to explain these terms within the context of futures cont...
August 21, 2023Read More >Averaging down: A Risky Move or a Smart Strategy?
Averaging down is an investment strategy in which an investor purchases additional shares or other assets at a lower price than their initial purchase price. This strategy is employed when the price of the asset has declined after the investor's initial purchase. Through buying more of the asset at a lower cost, the average cost per unit or share d...
August 21, 2023Read More >Market responses to actual versus consensus numbers in data releases
As traders and investors one of the important facts you need to get to grips with is the difference between Consensus (sometimes termed “expected”) and actual data. Variations in these can have a profound impact on asset prices and so are often part of your decision-making. In financial markets, the "consensus" refers to the average or m...
August 16, 2023Read More >Key market data explained: The Non-farm Payrolls
The Non-Farm Payrolls (NFP) is one of the most significant economic events data release of the month and is released on the first Friday by the U.S. Department of Labor. It is a comprehensive snapshot of the current state of US employment, and encompasses the total number of paid employees in the U.S. economy, excluding agricultural, government, pr...
August 16, 2023Read More >Understanding market data: Purchasing Managers Index (PMI)
The Purchasing Managers' Index (PMI) is an economic indicator used to measure the health and activity level of a specific sector of an economy, namely the manufacturing or services sectors. PMI data is published on a monthly basis and is of three types: Manufacturing PMI: This is the most well-known type of PMI. It measures the health of ...
August 16, 2023Read More >Understanding the US Dollar Index
The U.S. Dollar Index (USDX, DXY, DX, or, informally termed “the Dixie") is a measure of the value of the United States dollar relative to a basket of foreign currencies. It is often used as an indicator of the overall strength or weakness of the U.S. dollar in the foreign exchange market. Changes in the index value reflect shifts in the rel...
August 16, 2023Read More >News and Analysis
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